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State budget plan analyzed in first hearing

By Allison Thomasseau, Statehouse Correspondent

Updated:
02/15/2013 08:35:37 AM EST

BOSTON -- Legislators on the House and Senate Ways and Means Committee raised concerns about transportation equity, welfare regulation and elimination of critical tax breaks at the first hearing on next year's budget Thursday.

The hearing was the first of eight scheduled over the next several weeks. The fifth hearing, which will focus on health and human services, will be in Fitchburg on Feb. 28.

House Ways and Means Chair Brian Dempsey, D-Haverhill, said the House has begun to analyze the governor's budget proposal. The House plans to send its amended budget to the Senate in April.

Sen. Eileen Donoghue, D-Lowell, said the hearing gave her a broad overview of the proposal, but she is concerned with some details, such as eliminating the tax break when one sells their home.

"It's a concern, because for so many people, that's their sole asset," said Donoghue, a member of the Senate Ways and Means Committee. "Especially for seniors who are looking to downsize. They're looking at their home as their nest egg."

Glen Shor, secretary of the Executive Office of Administration and Finance, spoke in favor and provided information about Gov. Deval Patrick's $34.8 billion budget proposal that includes extensive changes in the state tax code and cuts to several programs.

"We cannot rely on the Rainy Day Fund, nor cut our way out of this," said Shor. "We have cut fat, we have cut muscle, and we have gone into the bone as well."

The governor's budget proposal includes raising the income tax 1 percent to 6.

In total, the budget will raise $1.9 billion to fund transportation projects, including MBTA service and expansion, early-childhood education and care, and higher education.

Most legislators at the hearing support reforms in education and transportation, but some disagreed on which aspects of the state's transportation system should be fixed.

Rep. Matthew Beaton, R-Shrewsbury, said transportation reforms should apply to the entire state, such as adding tolls on Interstate 93 to compensate for Massachusetts Turnpike tolls.

"We need to start a conversation about regional equity," said Beaton.

Other constitutional officers, including the secretary of state, inspector general, auditor, attorney general, and treasurer, presented budget proposals to the committee, and explained their department's funding requests.

The upcoming special election for U.S. Senate was an unexpected expense for this year's budget. Secretary of State William Galvin estimated it would cost at least $5.2 million. Auditor Suzanne Bump estimated it would cost about $8.3 million to run both the primary and general elections.

Inspector General Glenn Cunha requested $300,000 more than last year's $2.3 million budget, which would include better training and staffing for welfare assistance programs.

Last month the inspector general put out a report that there was a potential $25 million waste in the welfare system, with many people receiving benefits they were not eligible for.

Dempsey found the number troubling.

"To say that we need to follow up on regulations -- that's the most disturbing," said Dempsey. "Clearly there's a sense of urgency with this issue."

Senate Ways and Means Vice Chair Jennifer Flanagan, D-Leominster, agreed that welfare fraud is an issue the committee should address and should work to help the inspector general's office come up with a solution to the problem.

"We need to look at how these programs operate from the commission's standpoint," Flanagan said.

Funding is a big issue, but Flanagan cautioned against more money for electronic verification services, as opposed to hiring more employees.

"We need more verification, but we also need more one-on-one contact," Flanagan said. "It may be cumbersome and difficult, but we need to justify and track the money we're spending."

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